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How Broadband Can Catapult Nigeria Towards Economic Development

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According to the 2013 rebased GDP data of Nigeria, the telecommunications and information services sector contributed 8.68% ($44.3billion) to the newly rebased GDP figure of $522billion. This sector which was one of the newly added sectors to GDP computation statistics along with other sectors that included Music, Online Sales, Airliner and Film Production led to 89% increase in the GDP figure from the previous $324billion. This development led to Nigeria being the biggest economy in Africa.

Since Broadband services are clearly under the auspices of the telecommunications and Information sector, Broadband can then be inferred to have contributed to economic growth, which is sine qua non for economic (national) development. As Amartya Sen puts it, “economic growth is one aspect of the process of economic development”.

What then is broadband? Broadband, in the telecommunications sector, will refer to as a wide bandwidth data transmission with an ability to simultaneously transport multiple signals and traffic types. It must be noted that the term “broadband” is mainly used for data transmission over multiple channels. The Nigeria's National Broadband Plan (2013-2018) defines broadband as “as an internet experience where the user can access the most demanding content in real time at a minimum speed of 1.5Mbit/s.”

Before the advent of broadband, accessibility to the internet was mainly through dial-up access which was limited to 56 kilobits per seconds (Kbits/s from here onwards) unlike broadband which has a traditional capacity of 256 Kbits/s. This led to the popularization of broadband beginning in the early 1990's

The broadband uses various mediums to transfer data, among which includes Digital Subscriber Line (DSL), Cable Modem, Fiber, Wireless, Satellite, Broadband over Powerlines (BPL) among others.

• Digital Subscriber Line (DSL) is a wireline transmission technology that transmits data faster over traditional copper telephone lines already installed to homes and businesses. DSL-based broadband provides transmission speeds ranging from several hundred Kbps to millions of bits per second (Mbps).

• As for the Cable Modem service, it enables cable operators to provide broadband using the same coaxial cables that deliver pictures and sound to your TV set. Most cable modems are external devices that have two connections: one to the cable wall outlet, the other to a computer. They provide transmission speeds of 1.5 Mbps or more.

• Fiber optic technology converts electrical signals carrying data to light and sends the light through transparent glass fibers about the diameter of a human hair. Fiber transmits data at speeds far exceeding current DSL or cable modem speeds, typically by tens or even hundreds of Mbps.

• Wireless broadband connects a home or business to the Internet using a radio link between the customer's location and the service provider's facility. Wireless broadband can be mobile or fixed. Wireless technologies using longer-range directional equipment provide broadband service in remote or sparsely populated areas where DSL or cable modem service would be costly to provide. Speeds are generally comparable to DSL and cable modem. An external antenna is usually required.

• Satellite: Just as satellites orbiting the earth provide necessary links for telephone and television service, they can also provide links for broadband. Satellite broadband is another form of wireless broadband, and is also useful for serving remote or sparsely populated areas.

• Broadband over Powerline (BPL) is the delivery of broadband over the existing low- and medium-voltage electric power distribution network. BPL speeds are comparable to DSL and cable modem speeds. BPL can be provided to homes using existing electrical connections and outlets. BPL is an emerging technology that is available in very limited areas. It has significant potential because power lines are installed virtually everywhere, alleviating the need to build new broadband facilities for every customer.

In contrast to the broadband is the narrowband, which sends and receives only a single frequency channel. The availability of broadband leads to faster and wider access to information over the internet leading to advantages such as Rapid loading of web pages and e-mail (as much as 100 times faster than dial up access) and equally fast downloading of files, programs, and computer updates, a more efficient use of time online, the creation of an always-on connection, ready when you are to access the outside world, an added ability to easily stream video and music, a more efficient delivery of photos and other large e-mail attachments and lastly the technology enables people to work from home

However, the availability of internet connectivity for broadband leads to a concept called “internet penetration”. Internet penetration is the percentage of the population using the internet. If we are to compare internet penetration between Nigeria and other countries of the world, a survey conducted by the International Telecom Union (ITU) comes into view. The survey was conducted on 140 countries and focused on Household Internet penetration. In the survey, Nigeria ranked 87th with 7.8% penetration. In the 1st position was Korea republic with 98.1% penetration followed by Qatar and Singapore in 2nd and 3rd position with 96.4% and 86% respectively. From Africa; Morocco, South Africa and Egypt ranked 29th, 37th and 44th respectively.

The survey claimed that a high internet access or penetration will lead to creation of millions of jobs. A view at the economies of Korea, Qatar and Singapore (top 3 countries in the rank) even shows that they have achieved significant levels of national development as they are also part of the fast and rising Asian Tigers.

On the other however, to describe economic development, one has to explain economic growth which is the process of an increase in the productive capacity (output) of a country leading to an increase in the moneys available in circulation. If this increased productivity emanates from all sectors of the economy, leading to improved standard of living and greater economic welfare of the citizenry, then economic development has set in. It is important to note that, Economic (national) development is the ultimate goal of developing economies, and for the developed economies, they aim at ensuring continuous and stabilised development of their economies.

Economic development is the sustained, concerted actions of policy makers and communities that promote the standard of living and economic health of a specific area. Economic development can also be referred to as the quantitative and qualitative changes in the economy. Such actions can involve multiple areas including development of human capital, critical infrastructure, regional competitiveness, social inclusion, health, safety, literacy, and other initiatives

To connect the dotted lines between broadband and how it leads to National development, a statement from the president mandate in the Nigeria's National Broadband Plan (2013-2018) is of key note. It states that “it has been empirically proven that every 10% increase in broadband penetration in developing countries results in a commensurate increase of 1.3% in GDP.” This availability of faster internet connectivity facilitated by broadband creates economic opportunities and creation of jobs. This is achieved through a process by which the internet provides newer and dynamic methods of providing services to the populace. This process may include the fact that people have faster access to a bank of knowledge on the internet, exposure to information that facilitates technical progress, improved and faster methods of meeting customers' needs, creation of job opportunities for specialists in internet services, and lastly the additional income to internet service providers.

Another key area, which the availability of internet broadband services contributes to economic development, is in the area of research. Research which is an investigation into the unknown aims at establishing a fact about it through logical inferences. The availability of broadband in no small measure facilitates the conduct of research as the researcher is exposed to a much broader range of information, data and specimens for tests. S/He is better able to access a wide range previously conducted research in his field of interest and also determine if indeed there is a necessity for that research. If the result of a research is acceptable, it will propose a better method or means at solving a problem faced by society, leading to improved welfare and ultimately economic development.

The sum totals of these activities create a multiplier effect on the economy. This multiplier effect is defined as a process by which an increase in aggregate demand leads in the long run to an increase in the value of the national output and wealth. Whenever, there is an increase in national output, economists like to refer to such a scenario as “economic growth”. This economic growth that is achieved stems from varying process that broadband creates.

But the process does not stop here; economic growth if sustained will lead to economic development. This process can be explained using a hypothetical case in the e-commerce sector. Saying for example in the online shop market in Nigeria where there are companies like Jumia, Konga, e.t.c. The availability of broadband internet services has helped connect both the customers and retailers together to transact business. Over the past few years this has increased competition among them leading to improved quality and lower prices and ultimately better standard of living for consumers. The aspect of better living standards is an evidence of economic development.

The above case is just an example, there are varying jobs and opportunities such as, internet advertising, software sales, internet service providers, blogging, website designing that broadband internet connectivity creates.

However, it is also important to note that broadband services are restricted by a myriad of problems too. One of such is the fact that, the high monthly fee charged by Internet Service Providers (ISP) as compared to dialup internet access. This problem stems from the high cost of leasing transmission infrastructure, multiple taxation of the firm at federal, state, and local government levels, the damage to existing fibre infrastructure as a result of cable theft, road works and other operations; and lastly the lack of reliable, clean grid electricity.

Another constraint of broadband service is the fact that broadband infrastructure is not readily available across all parts of the federation. It is usually not available in rural or remote areas of the country; this places a huge constraint on access to the internet and the solutions it provides. As a means of solution, the regulator commission, that is, the Nigerian Communication Commission through directives and persuasion can instruct Internet Service providers to install broadband infrastructure in such areas. An incentive such as lower amount being charged as license fee may motivate response to such directives.

Also, the recent cyber security issues depicted by growing cybercrime, software cracking, copyright infringement, identity theft and physical attack of broadband infrastructure by means of vandalism, sabotage and theft has led to massive sabotage to the sustenance of broadband services. The issue of main concern is the fact that the existing laws do not cover cyber crime and attacks, thus to curb this menace which poses a threat to a belief in broadband internet connectivity, there will be a need for government to upgrade its laws so as to incorporate this menace and equip its ICT staff in identifying and tracking perpetuators of such crimes so that they can be charged on the law. Else, the trust in the cyber environment will drop and there will be less demand for broadband services which reduces the prospects for economic development.

As was stated in the Nigeria's National Broadband Plan (2013-2018) that the government of the federal republic of Nigeria aims at ensuring that internet penetration should increase by five (5) fold before the end of 2017 and also aiding the actualization of the developmental goals of Vision 20:2020.

It has been shown, that the availability of broadband infrastructure drives an economy towards economic and social growth placing an economy on the frontiers at achieving a digital revolution and a knowledge-based economy characterised by the creation of new industries and introduction of significant efficiencies into education delivery, ensuring public safety, health care provision, and energy management.

The private sector must thus be innovative and driven to ensure that it achieves a fast, reliable and affordable broadband internet access and the Federal government should ensure that it provides the required infrastructure and necessary laws and also that the regulatory body, that is, the Nigerian Communication Commission, ensures that the sector is well regulated through conscious attempt to control the activities of broadband providers and issuing of licences for operation in the telecommunications and information's sector.

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4. Types of Broadband Connections []

5. Nigeria's National Development Plan (2013-2018). The President Mandate, The Executive Summary.

6. Economic Development []

Disclaimer: "The views/contents expressed in this article are the sole responsibility of Abiola Ayodeji Gbemisola and do not necessarily reflect those of The Nigerian Voice. The Nigerian Voice will not be responsible or liable for any inaccurate or incorrect statements contained in this article."

Articles by Abiola Ayodeji Gbemisola